Tag Archives: GST

Giving his reaction to the Union Budget announced today, PP Khanna, President, ADTOI, said, “The budget was expected to be a comprehensive roadmap for the next five years but appears to lack substantial long-term strategies. Specific sectors, such as tourism, received attention, but the initiatives may seem insufficient in scope.” Commenting further, he said, “The government has implemented GST, which has reduced the compliance burden on trade and industry by unifying the highly fragmented indirect tax regime in India. The tax base of GST has more than doubled, and the average monthly gross GST collection has almost doubled to ₹1.66 lakh crore. On the other hand, no specific information on TCS in the tourism industry is available. The tourism industry has been impacted by the introduction of GST and TCS, with some tour operators and travel agencies facing challenges in complying with the new tax regime. However, the government has taken steps to simplify the tax process and reduce the compliance burden on businesses. The general sentiment is that the budget does not fully meet the high expectations set by previous promises.”

Urging the Government of India ahead of the upcoming Union Budget, Nitin Mittal, Coordinator South, NIMA, said, “The government of India should think of providing GST rebates or GST refunds to the MICE group or international tourists on shopping, if not then at least on the purchase of sustainable products like khadi, and Indian handicrafts.”

FHRAI reiterated one of its key requests in the pre-budget meeting conducted by the Finance Ministry to grant infrastructure status for hotels across all categories and convention centres built at a project cost of ₹10 crore and above to give a fillip to the budget segment in the industry, along with 12 per cent GST rate across all hotels.

HRAWI recommends reform in GST framework for restaurants within hotel premises. “The sudden jump in GST from 5 per cent to 18 per cent when room rates exceed ₹7500/-, creates uncertainty for guests and places hotels at a disadvantage. We have submitted a representation to the Government,” said Pradeep Shetty, President, HRAWI.

IATO has thanked Finance Minister, GST Council and the Chairman CBIC for favourably considering  two of its recommendations- removal of, GST on services provided outside India to foreign tourists if they take combined package of India and neighbouring countries and  secondly GST for the ferry service hired for transport of passengers including tourists used as public transport from point to point transport in Andaman & aNicobar Islands,  in the GST Council meeting held in Chandigarh.

Ajay Singh, CMD, SpiceJet, at a post-budget interaction with Finance Minister Nirmala Sitharaman, put forth the difficulties being faced by civil aviation, travel, tourism and hospitality sectors. He requested her to consider granting infrastructure status to these sectors to facilitate lending by banks and financial institutions. He also requested the Hon’ble Finance Minister’s support for inclusion of Aviation Turbine Fuel under GST. The FM gave a positive response to consider these issues.

Taking measures to mitigate COVID-19 impacts on the industry, the Rajasthan Government has extended a helping hand to hotels and tour operators registered in the State. According to an order by the state government, it has been decided to reimburse State Tax due and deposited by hotels and tour operators registered under Rajasthan Goods and Services Tax Act, 2017. The order for a reimbursement of State Tax due and deposited to hotels and tour operators will come into effect from April 1 and will remain in force till June 30. ‘State Tax due and deposited’ means the amount of State Tax (SGST) paid through debit in the electronic cash ledger account maintained by the enterprise after complete utilisation of the available amount of input tax credit of the SGST and Integrated Goods & Services Tax (IGST). This order will be applicable for taxable persons registered under the category of hotels, heritage hotels, resorts and tour operators. However, it will not cover stand-alone restaurants and clubs. Beneficiaries will be entitled for reimbursement of State Tax due and deposited in the operative period in the manner as may be prescribed, provided no reimbursement under this order is available for SGST to be leviable and paid on rental or leasing services, including own or leased non-residential property.

Voicing his opinion of the Union Budget, Gurbaxish Singh Kohli, Interim President, FHRAI, said, “The industry expectations were high but the Union Budget has neglected us completely and we are disappointed yet again. While the Govt. wants to give impetus to hospitality and tourism and our. PM has envisioned big things for the sector, there is no mention except for the 17 tourist-friendly spots which we welcome. We were expecting reforms in rate slabs of GST, Input Tax Credit and a definitive step to boost the domestic and inbound traffic. Hospitality plays a vital role in the growth of the economy therefore this sector cannot be ignored. It is one of the biggest contributors to GDP, taxes, Foreign Exchange and most importantly in generating employment. The success of Incredible India lies in managing its hospitality and tourism right and requires policy support.”

Pronab Sarkar, President, IATO, shared that there was again no focus on tourism in Union Budget 2019-20, except that the government re-emphasised on 17 iconic sites being developed into world-class tourist destinations, which has been taken forward from the last Budget. “However, we welcome the mentioning of simplifying of GST process and absorbing of charges on digital transactions, which will encourage digital transactions. We also welcome the government’s plan to restructure the national highways programme to create a network of highways for better connectivity, upgradation of 125,000 km of roads in next 5 years at a cost of 802.5 billion rupee, more focus on Swachh Bharat mission and expansion of Railway suburban networks which will boost tourism as with increased infrastructure, better road connectivity and clean India, foreign tourists will be attracted.” He added, “We have been requesting the Government  for rationalizing of GST on tourism and hospitality, exemption of GST on foreign exchange earnings by the tour operators and treating tourism industry as deemed exporters and extending all benefits to the tourism industry as are being given to physical exports of goods and reduction, in Tourists Visa Fee so that we can compete with our neighbouring countries on foreign tourists arrivals, which will not only help bring in more foreign exchange but also create new jobs. However, this all remains pending and we hope our requests will be considered by the GST Council and Finance Ministry will consider the importance of tourism industry in employment generation and contribution in economic growth of the country.”

The Maintenance, Repairs & Overhaul (MRO) Association of India (MAOI) has appealed to the Finance Ministry to, on priority, fix the lop-sided tax policies to create a level playing field between the Indian MRO industry and foreign MROs. The MAOI has stated that in the current financial year 2018 -19, the industry has registered negative growth. With 90 per cent of the MRO requirements of India being imported, the import driven policy has lost 90,000 direct jobs to countries like Sri Lanka, Singapore, Thailand, France and Germany. The MAOI has made recommendations to the government for the future and growth of the Indian MRO industry: reduce GST for Indian MRO services to 5 per cent to bring it on par with foreign MRO services. Alternatively, customs duty on MRO services (where such capabilities exist in India as per DGCA CAR 145 approved organisations list) should be applied at 18 per cent on all imports and grant of ‘infrastructure’ status to MRO industry. Bharat Malkani, President, MAOI, says, “Based on data from Original Equipment Manufacturers (OEMs), the current fleet of 550 airliners is expected to grow to 1000 by 2023. The government is focused on creating new infrastructure and is encouraging domestic carriers to expand their fleet size. While this is a positive development for Indian Aviation, it has no bearing on its immediate ancillary MRO sector. This is because the present GST for importing MRO services to India is levied at 5 per cent, whereas the same services offered at home are taxed at GST of 18 per cent. Of the several requests we are making to the Ministry through the pre-budget memorandum, our highest priority is to have the GST …